Ask Carrie: Generosity doesn't always come with a high price tag

Dear Readers: Last week, I talked about Giving Tuesday and ways to increase your charitable giving. This week, I’d like to talk a bit about how to creatively extend that spirit of generosity to friends and family. Giving traditional gifts is fun, and I enjoy choosing what I think is ideal for someone. But when possible, I like the idea of wrapping that gift in a package that may have a bigger meaning. So before we all get caught up in the holiday buying frenzy, here are some ideas on how to do just that.

Start with a list

As your circle of family and friends grows, it can be a challenge to give meaningfully to everyone. To help you focus on the people to whom you want to be generous, make a list. Put your dearest family members and friends at the top, and work down to the others in your life whom you want to acknowledge in some way.

Think carefully about each recipient. What would be most appreciated? It’s not about how much money you spend — even if money isn’t an issue — but rather about why you think a certain gift will be just right. For some people on your list, a small token will be meaningful. For others, your creative approach to their gift may make the value of it even greater.

Wrap your gift in financial know-how

One way to give your gift added meaning is to make your own financial know-how part of the package. Everyone in your life — from your youngest child to your parents or grandparents — could likely benefit from your insight and experience with money, investing and personal finance. And there are some creative ways to share that wealth of knowledge.

For instance, the perfect sweater might make your teenage daughter momentarily happy, but perhaps attaching it to a clothing allowance that she has to manage would give you the chance to teach her about budgeting, saving and spending wisely. A piggy bank for a younger child could come with a savings account and a trip to your bank to learn about how money grows over time.

If someone on your list is a student working part time or a young adult who has recently entered the workforce, how about helping the person open a Roth IRA, perhaps with some initial funding from you, and then offering to match the person’s contributions for a time? You can then help the person get started investing for the long term. That’s a gift that can have a lifetime of value.

Even older adults, perhaps your parents, could benefit from your gift of knowledge. If they’re struggling economically and you can help out monetarily in some way, that’s great. But if you also helped them budget more wisely and made certain that they’re making the most of their Social Security and Medicare benefits, that would take your economic support further. Even if they aren’t struggling, perhaps you could help them fine-tune their finances or estate plan by offering to help them meet with the appropriate professional.

Be generous with your time

Giving your knowledge also involves giving the time it requires to help a child or parent learn more about finances. However, time can also be spent just on fun. Whether it’s with a friend or family member, arranging a special event together — a dinner, a visit to the museum, a ballgame, a special vacation — can be the most perfect gift of all. If you have the ability to foot the bill, great. If not, sharing the cost, as well as the experience, can be just as thoughtful.

Give a purpose to your monetary gifts

A gift of cash, of course, is always appreciated. But earmarking the money for a larger purpose or a long-term goal can be even more significant.

For example, opening a savings account or custodial account for a young person is a way to introduce personal finance basics and perhaps initiate an interest in investing. Creating a 529 plan for a child or grandchild is a gift to the parents, as well as to the child. Or if kids are already in college, you could offer to make a direct tuition payment to the school.Another idea is to jump-start the process of saving for a big-ticket item — such as a car, a computer or a family trip. Or if you know that someone on your list has a cause or charity that is of particular importance, you could make a donation in that person’s name.

Make it mutually rewarding

So often during the holidays, people worry about overextending their budgets, or they feel bad that they can’t afford the type of gifts they’d like to give. But to me, being generous isn’t just about money. It’s about being thoughtful and willing to share your time and knowledge, as well as your good fortune. By doing so, you may find you’re also giving yourself a wonderfully rewarding experience.

Carrie Schwab-Pomerantz is president of the Charles Schwab Foundation and author of “The Charles Schwab Guide to Finances After Fifty.”